Regulation & Policy

Posted on: March 27, 2016

WALL STREET JOURNAL

Grid Block: Solar Contractors Caught in Quandary

The Wall Street Journal (subscription required) reports on the plight of solar installers in states where utilities have lobbied legislatures to reduce or eliminate rebate programs while allowing higher grid-connection fees for solar home owners and lowering the rate utilities pay for power solar homeowners sell back to the grid.

More than 900,000 homes across the U.S. are equipped with solar panels, with most of those homeowners able to sell any excess electricity their houses generate back to the utility, helping reduce the cost of home solar panels by up to 30%. But the price solar customers get paid for that extra renewable power through so-called net metering is starting to fall, as several states, including Nevada and Hawaii, have slashed their solar subsidies.

Utilities in Arizona, Colorado, Louisiana, Utah and many other states are currently proposing measures that include changing their net metering programs or raising the monthly fees charged to home solar users for hooking their equipment to the power grid. The utilities argue that the ever-smaller base of traditional power customers shouldn’t get stuck paying all the costs of maintaining the grid.

However, the advent of new battery technology, such as Tesla's PowerWall, promises to allow solar homeowners to completely disconnect from the grid, freeing themselves from all utility fees and ensuring that, when the grid goes down, their homes will not.

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